Securities regulators say some exempt-market issuers are not properly disclosing the fees and commissions charged on their offerings, and are relying on exemptions that are not available in all provinces, among other failings.

These problems are detailed in a staff notice published Thursday by the Canadian Securities Administrators (CSA).

“We have observed that some issuers or underwriters are not reporting compensation paid in connection with a distribution,” the CSA states in its notice.

“Compensation includes commissions, discounts or other fees or payments of a similar nature, which result from a distribution of securities, regardless of what the payment is called,” the notice states. This does not include payments for services that are incidental to the distribution, such as clerical, printing, legal or accounting services.

The CSA has also observed issuers distributing in more than one jurisdiction under an exemption that is not available in one of those jurisdictions. In some cases, this may stem from the fact that not all jurisdictions in Canada offer the same types of exemptions. As a result, issuers may have to report multiple exemptions being relied on for the same purchaser in cases in which a distribution is made in more than one jurisdiction, but the same exemption is not available in all of those jurisdictions.

Regulators have also seen issuers improperly reporting distributions under the so-called “minimum amount exemption,” which requires purchasers to buy at least $150,000 of an offering. “If an issuer or underwriter relies on this exemption, it should ensure that the purchase price reported is at least that minimum amount,” the notice states. “We also remind issuers or underwriters that it is not permitted to distribute securities under this exemption to multiple purchasers acting in concert or as a ‘syndicate’ in order to pool separate purchases and reach the $150,000 minimum.”

Other matters mentioned in the notice include reporting exempt distributions on the wrong form; failing to file on time; failing to pay the required filing fee; and not including a complete list of purchasers or incorrectly identifying the number of purchasers.

The CSA is detailing these deficiencies to help issuers, underwriters, and their advisors avoid similar problems in future filings, the notice states.